Affordable cars on finance

Want a desirable car with low monthly payments? PCP finance means you can get the same car with far lower monthly payments than with a loan

James Wilson
Mar 26, 2021

In the past, if you wanted to get a new car, you had to have the cash to buy it outright - or take out a loan to cut the cost into smaller chunks. Now, however, PCP finance - where your monthly payments effectively cover the difference in value between a car's initial price and what it's expected to be worth at the end of the contract - means that you can get all sorts of desirable cars for far lower monthly instalments than with a loan.

Therefore, if you're open to PCP, you can afford to get a far more expensive car on your monthly budget than with a traditional loan or Hire Purchase. As a result, you can get all sorts of relatively recent used cars from around £100 per month to £250 per month. Just remember that the type of finance you go for affects not only the size of the monthly payments but also whether you own the car at the end of the contract.

While PCP finance comes with low monthly payments, you don't own the car unless you make the large optional final payment at the end of the contract. If you're happy to hand the car back at the end of the contract, you don't need to pay this, though bear in mind that it can amount to around half of the car's initial price, so it's worth having a think about how you'd pay for this if you want to keep it. Meanwhile, Hire Purchase comes with higher monthly payments, but once you've made the last instalment, the car is yours to keep.

Used cars under £250 per month

One of the reasons why car finance is so popular is the fact that it allows drivers to make their money go further. Rather than having to stick to old and unreliable cars with a very low cash price, finance allows motorists to get behind the wheel of safer, more economical and more desirable cars for an affordable monthly payment.

Even so, some cars represent better value than others. Track down one of these forgotten models and you can get far more car for your money than you might expect. For example, some cars are less in demand than more obvious choices. Most people are familiar with the Volkswagen Golf but many would struggle to identify a Kia Ceed despite it being a cracking car available for much less than a similarly equipped Golf.

Below we've rounded up a variety of cars (from small city cars to seven-seat SUVs) which all offer excellent value on finance. To qualify for this list, each car had to be less than seven years old, cost no more than £250 per month (many can be scooped up for significantly less) and be an appealing all-round car. We've chosen cars that offer a reasonably large boot, relatively low running costs and plenty of standard equipment.

Affordable cars on finance

1. Fiat Panda

Best affordable city car on finance

Our pick Fiat Panda 0.9-litre TwinAir Lounge
Used deals Limited stock

The Fiat Panda isn't concerned with being the fastest or most stylish city car. Instead it offers motorists an affordable and easy-to-live-with motoring proposition. The Panda will put a smile on many drivers' faces, too, since it's fun to drive, especially with Fiat’s 0.9-litre 'TwinAir' engine under the bonnet, which makes a deep, characterful noise when you work it hard.

With the Panda it makes sense to go for the highest specification model money will allow, as entry-level city cars can be quite basic, so having extra features makes a big difference. Lounge models sit at the top of the regular Panda range and come with electric front windows, alloy wheels, air-conditioning and Bluetooth, making them an appealing option.

There are also some rugged Pandas which get jacked up suspension and plastic cladding around the bottom of the car to give them a tough off-roader style look. Be aware, though, that only some of these are four-wheel-drive. Hunt one of these down if you want the greatest off-road ability and grip on slippery surfaces.

FIAT PANDA BUYERS' GUIDE

2. Nissan Micra

Best affordable supermini on finance

Our pick Nissan Micra 0.9-litre Acenta
Used deals from £4,999
Monthly finance from £101*

The Nissan Micra is surprisingly expensive as a new car, but thankfully it's far better value as a second-hand purchase. That makes the latest-generation Micra - which is far more stylish than older versions - a great choice, as monthly payments are very affordable. The Micra is well made, enjoyable to drive and more than practical enough for most small car drivers with a decently sized boot.

The Micra makes its strongest case for ownership in Visia+ or Acenta trims, as features such as air-conditioning, alloy wheels and start/stop are standard. 'Start/stop' automatically turns the engine off when you're stationary in a bid to save fuel and is a common feature on modern cars.

On the subject of saving fuel, a rather frugal 1.5-litre diesel engine was available in the past and is a good option for those who cover high mileages and will benefit from the increased fuel consumption. However, it is the turbocharged 0.9-litre and 1.0-litre three-cylinder petrols which are the engines to have in most cases, thanks to their nippy performance, which helps them to make light work of daily driving.

NISSAN MICRA BUYERS' GUIDE

3. Kia Ceed

Best affordable medium hatchback on finance

Our pick Kia Ceed 1.0T GDi ISG
Used deals from £5,990
Monthly finance from £127*

Kia used to be regarded as a budget option, a brand to resort to when the car you really wanted was out of reach. Times have changed, though, with cars such as the previous-generation Kia Ceed showing that the company can come up with great build quality, strong reliability and a decent driving experience.

Strictly speaking, the previous generation Ceed was called the 'Cee’d', but the apostrophe was dropped for the same reason it hasn’t been included here - it’s just a bit awkward. What you need to remember when choosing between cars is that the model referred to here is branded the 'Cee'd' and the newer, more expensive model is the 'Ceed'.

As with all modern-day Kias, the Ceed came with a seven-year/100,000-mile warranty, so most second-hand models will have plenty of manufacturer cover left. When looking for the best models there is plenty of choice - our pick would be the 1.0-litre petrol but the diesel engines come a close second if you cover high mileages and need the most economical option possible.

Kia’s core range constitutes 1, 2 and 3 trims - the higher the number, the more equipment you get - with all models featuring air-conditioning, Bluetooth and even a cooled glovebox.

KIA CEED BUYERS' GUIDE

4. Nissan Juke

Best affordable small SUV/crossover on finance

Our pick Nissan Juke 1.2-litre DiG-T Acenta
Used deals from £6,490
Monthly finance from £132*

Nissan has had something of a runaway success with its previous-generation Juke and that is despite its rather funky styling - which some people love and others hate. It wasn’t a fluke, though, as the old-shape Juke is easy to live with, well-built and in most situations a comfortable and competent drive.

When compared to some other small SUVs (such as the Peugeot 2008) the Juke isn’t as practical and in comparison to some supermini alternatives (such as the Ford Fiesta), it isn’t as much fun to drive. That said, many motorists seem to appreciate something like the Juke which sits halfway between practical and fun.

There are a number of Jukes which have been around for quite some time, but it is post-2014 models that are the best to look for. The reason being, Nissan revamped the Juke in 2014 updating its styling, increasing its boot size and improving the on-board technology, making it a more appealing prospect.

Nissan’s 1.2-litre 'DIG-T' petrol engine is the pick of the range, offering surprisingly strong performance and good fuel economy. Automatic and manual gearboxes are available but the latter is the better option.

Interestingly, Nissan did make a sporty Juke, called the Juke Nismo, but unless it is love at first sight other performance cars (such as the Ford Fiesta ST) are significantly better to drive and thus likely to be a better choice for you. The Juke Nismo isn't the most comfortable car with firm suspension and neither is it the sportiest model, making the Fiesta ST a much better bet.

NISSAN JUKE BUYERS' GUIDE

5. Renault Kadjar

Best affordable mid-size SUV on finance

Our pick Renault Kadjar Dynamique Nav
Used deals from £8,200
Monthly finance from £141*

Those looking for a decent quality, affordable, practical and relatively cheap-to-run mid-size SUV need look no further than the Renault Kadjar, as it promises all of this and more. Yes, you read that right - more.

As an example, while a number of rivals are more fun to drive, the Kadjar excels as the kind of comfy cruiser that will get a driver and their passengers home with minimal drama. Which, let’s face it, for many drivers - especially those with children to ferry around - is worth 10 times as much as having super-sharp steering and a quick throttle response...

Renault has overhauled most of its models’ trim levels in recent years, so there is a fair number of specifications to choose from. For post-2018 models, mid-range Iconic spec is a great option, while for pre-2018 models Dynamique Nav variants are the best all-rounders when considering cost vs equipment.

The range of engines is quite extensive, too. Higher mileage drivers will want to look at 1.5-litre diesels, as these offer the best fuel economy, while the newer 1.3-litre petrol engines are a great option for those that do fewer miles per year. The older 1.2-litre petrol versions are strong choices, too.

RENAULT KADJAR BUYERS' GUIDE

6. Land Rover Discovery Sport

Best affordable large SUV on finance

Our pick Land Rover Discovery Sport 2.0-litre SE
Used deals from £18,250
Monthly finance from £260*

The Land Rover Discovery Sport is by no means the largest SUV on the market, but it is one of the most affordable that is big enough to seat seven. Not only does it have ample space for a large family, but thanks to Land Rover’s excellent four-wheel-drive knowhow it is rather good off-road, too.

Such talents also make the Discovery Sport a good choice for those who need to tow something, with strong engines and decent grip from the four-wheel drive system fitted to a majority of models, making it a very capable machine. Journeys in the Discovery Sport are likely to be comfortable thanks to standard equipment including heated front seats, a heated front windscreen and a 10-speaker sound system in most models.

It is worth noting that while the majority of Discovery Sports are seven-seaters, there are a few five-seaters out there. Similarly, there is a small number of two-wheel drive Discovery Sports (badged as ‘eD4’), which, while not nearly as good off-road, cost less to run than models with power going to all four wheels, as they offer improved fuel economy.

As for other options, manual and automatic gearboxes are both available - though the automatic gearbox better suits the car - and there are both petrol and diesel engines to choose from. Diesels fit the car better here, offering greater muscle from low engine speeds.

LAND ROVER DISCOVERY SPORT BUYERS' GUIDE

7. Peugeot 308 SW

Best affordable estate on finance

Our pick Peugeot 308 SW 1.2-litre Active 130
Used deals from £5,465
Monthly finance from £129*

It is a wonder that the Peugeot 308 SW (or Station Wagon to give it its full name) is so affordable given it is something of a class leader when it comes to cabin space. Plus, it looks good and it is available with a number of efficient engines. Size-wise the 308 SW is a rival for practical cars such as the Ford Focus Estate and the impressively large Skoda Octavia Estate.

Handily, practicality does not come at the expense of the driving experience as the 308 SW is much the same as the standard hatchback 308 out on the open road - irrespective of whether a petrol or diesel is being driven. It is comfortable and reasonably satisfying to drive.

Peugeot launched the current 308 SW back in 2013 and refreshed it in 2017 - the updates included subtly revised styling, a better media system and also a new automatic gearbox for range-topping models. If finances will allow, the post-2017 models are well worth hunting down.

As for trim, it is best to skip basic entry-level Access versions and go straight up to Active specification as air-conditioning, cruise control, 16-inch alloy wheels, parking sensors and sat-nav are all standard. Not too shabby for the price. As for engines, the 130hp 1.2-litre three-cylinder is a great option, providing both punchy and economical, as is the 1.6-litre diesel, which makes a better option for drivers covering particularly high mileages.

PEUGEOT 308 SW BUYERS' GUIDE

8. Seat Leon Cupra

Best affordable performance car on finance

Our pick Seat Leon 2.0-litre TSI Cupra 290
Used deals from £13,780
Monthly finance from £234*

The previous-generation Volkswagen Golf GTI was pretty darn good - it handled corners well, its 2.0-litre petrol engine was strong (but still relatively economical) and it was practical. Why is this relevant? Well, VW owns Seat and much of what went into the Golf GTI (and the even faster Golf R) has gone into the Leon Cupra.

The best news is that second-hand versions of the Leon Cupra are very affordable indeed for a car of this type. A no-brainer then? Yes, provided you can find a good one. Knowing which model to look for, however, is no easy task thanks to Seat offering its previous-generation Cupra Leon in a number of flavours.

The best versions come with a power output between 280 to 300hp. Earlier models were available with a manual or automatic gearbox but the former was soon removed as an option. Similarly, up to around 2018, there were three- and five-door versions, but the former bit the bullet following slow sales.

An important milestone in the Leon’s life came in 2017 when Seat gave it a refresh, meaning post-2017 models have ever so slightly improved in-car tech and sharper styling compared with older versions. A major advantage to driving a Leon Cupra over its rivals is that they come with some proper go-faster engineering, such as adaptive suspension (which allows a driver to fine-tune the suspension to the type of driving they're doing) and a 'limited-slip differential' (which helps transfer as much power as possible from the engine to the road without spinning the wheels too much).

SEAT LEON BUYERS' GUIDE

*Representative PCP finance - Ford Fiesta:

48 monthly payments of £192
Deposit: £0
Mileage limit: 8,000 per year
Optional final payment to buy car: £2,923
Total amount payable to buy car: £11,926
Total cost of credit: £2,426
Amount borrowed: £9,500
APR: 9.9%

BuyaCar is a credit broker, not a lender. Our rates start from 6.9% APR. The rate you are offered will depend on your individual circumstances.

 

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